Why You Can Trust CNET Amazon customers can sue the company in court after policy change
The retail giant quietly cuts a requirement to privately arbitrate all disputes from its terms of service.
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The previous policy also made it impossible for customers to join together in class actions.
Amazon has quietly updated its terms of service to allow customers to bring lawsuits to court, instead of requiring that disputes be handled in arbitration. The move, reported earlier by The Wall Street Journal, bucks a trend employed by many companies, with arbitration agreements buried in the terms of service for many apps and websites.
The conditions of use on Amazon's website, which was updated May 3, now state: "Any dispute or claim relating in any way to your use of any Amazon Service will be adjudicated in the state or Federal courts in King County, Washington, and you consent to exclusive jurisdiction and venue in these courts. We each waive any right to a jury trial."
Gone is the language requiring each claim be brought individually in arbitration, which not only kept disputes out of courts, but made it impossible for customers to join in class actions. Now all US customers can file claims in court, but the courts must be in the county that includes Amazon's Seattle headquarters. Washington state laws apply to Amazon's dealings with all US customers under the new policy.
Amazon didn't immediately respond to a request for comment. The retail giant has faced criticism in the past for forcing consumers, as well as workers and third-party sellers on its platform, to use arbitration to settle disputes.
The new policy's mere two sentences replace more than 350 words detailing Amazon's previous arbitration requirements, which are preserved in an archived version of the web page. Arbitration is a private process used to solve disputes outside of the traditional court system. There are no public records available of arbitration proceedings as there would be with a court case, and an arbitrator's decision doesn't set any precedents for how to apply laws to similar disputes.
Arbitration can speed up the process of resolving a legal dispute, which can save parties money in some cases. However, each party must pay their portion of the arbitrator's fees, which are typically much more expensive than court costs like filing fees.
The change comes after Amazon was reportedly flooded with thousands of individual arbitration demands filed by lawyers on behalf of consumers using the company's Echo devices. The burst of demands "triggered a bill for tens of millions of dollars in filing fees," payable by Amazon under its earlier terms, according to the Journal.